SK Geo Centric, the eco-friendly chemical corporation, has made an equity investment of US$55 million (approximately 68 billion won) in PureCycle Technologies (PureCycle), the American plastic waste recycling company.
PureCycle has a proprietary chemical recycling technology that utilizes a solvent to remove contaminants, odors, and colors from waste plastics to extract Ultra Pure Recycled Polypropylene (UPR PP).
Following after Plant 1 with an annual capacity of approx. 50,000 tons, completing its construction in the fourth quarter of this year, PureCycle is planning to break ground for Plant 2, which can produce about 300,000 tons annually, in Georgia this month. By the private equity capital raise, PureCycle attracted investment worth $250 million.
SK Geo Centric participated in the equity investment as a strategic partner and jointly operates the establishment of production facilities in Korea. Also SK geo centric and PureCycle plan to jointly push for global business expansion in China and Asia.
Polypropylene (PP), the plastic material of which PureCycle has a specialized proprietary technology to recycle, is a widely-used material in diverse colors and forms for car interior materials, electronics, food containers, toys, and daily necessities.
It accounts for 25% of the demand for plastics, but since physical recycling has a limitation to remove impurities, colors, and odors from this material, its recycling rate only remains below 5%. It is expected that using PureCycle’s technology can reduce the amount of plastics incinerated/landfilled and significantly contribute to enhanced recycling rate by recycling them into the virgin-like PP.
After signing the non-binding Head of Agreement (HOA) to open Asia’s first UPR resin facility in January, SK Geo Centric has made a decision to become PureCycle’s strategic partner through this investment. Through several technology verifications and marketing strategy discussions with PureCycle, the partnership is an outcome after SK Geo Centric’s comprehensive yet careful consideration of plastic waste recycling technologies and growth potential.
As PureCycle sealed pre-sale contracts on products produced in the Ohio plant, which plans to complete its construction this year, with global consumer goods corporations, such as P&G and L’Oreal, the company is recognized for its technological competitiveness.
SK Geo Centric and PureCycle are planning to establish a waste plastic recycling facility in Ulsan-Mipo Industrial Park by late 2024 as they will establish a joint venture (JV) and start the plant construction for solvent extraction of UPR PP this year. SK Geo Centric will have an exclusive right to sell the UPR PP, which is produced from this process, handling about 60,000 tons of waste plastics annually, in Korea, and the two companies are planning to expand their business to China and the Southeast Asian region.
Mike Otworth, CEO, PureCycle, said, “SK Geo Centric’s investment in PureCycle underscores their vote of confidence in our purification technology. They have been a valuable partner, working alongside our team to advance discussions to open the first PureCycle plant in Asia. We are proud to include them in our investor group and their investments marks an integral step for our company and highlights a key partner’s trust in our ability to execute.”
“We will secure three key differentiated technologies for chemical advanced recycling, including pyrolysis and depolymerization technologies, and accelerate the establishment of the circular economy for plastics through creating a recycle cluster in Ulsan,” said Na Kyung-soo, CEO of SK Geo Centric.
